The document summarizes CEFIM's activities to accelerate clean energy finance and investment in Indonesia. It discusses Indonesia's clean energy goals and investment needs to achieve net zero emissions by 2050. CEFIM has conducted various workshops, policy reviews and trainings in Indonesia to increase knowledge of clean energy finance and mobilize more private investment in renewable energy projects. Upcoming activities include a focus on gender-responsive and transition finance to support Indonesia's just energy transition away from coal.

1. ACCELERATING INVESTMENTS IN
CLEAN ENERGY IN INDONESIA
1
Geraldine Ang
Co-team lead CEFIM
Session 7a: Opportunities and challenges for the energy sector
in a net-zero future
Part I. Towards a net-zero electricity sector
8 March 2023, 14:30-15:30

2. Aim: to help accelerate clean energy finance and
investment by strengthening domestic enabling
conditions
Scope: renewable electricity, energy efficiency and
decarbonisation of industry
Activities:
2
Overview
CEFIM country partners: Colombia, Egypt,
India, Indonesia, Philippines, South Africa,
Thailand and Viet Nam
www.oecd.org/cefim

3. 3
Breakdown of Indonesia’s CO2 emissions
Source: OECD/IEA (2022)
Growth in coal-fired electricity generation contributed more than half of the doubling of CO2 emissions from the energy sector since 2000
Decarbonisation of the power sector is the cornerstone of achieving Indonesia’s 2060 net-zero emission target

4. 4
Average annual investment in the electricity sector in
Indonesia in the Net Zero Emissions by 2050 Scenario
Source: OECD/IEA (2022)
Significant boosts to investment for low emissions generation and networks enables accelerated decarbonisation
of the power sector in the Net Zero Emissions relative to the Announced Pledges Scenario (APS)

5. 5
Indonesia’s power capacity expansion to 2050
for various 1.5C pathways
Source: IRENA (2022) PES: Planned Energy Scenario
Solar PV investments will play a key role regardless of the 1.5C pathway

6. 6
A 6-fold increase in renewable energy capacity is
needed to reach the RUEN targets
0
5
10
15
20
25
30
35
40
45
50
2019 2025 RUEN* targets
GW Other**
Waste-to-energy
Bioenergy
Wind
Solar
Small hydro
Hydro
Geothermal
Source: OECD based on MEMR and PLN statistics as well as Presidential Regulation No. 22/2017 Concerning
General Planning for National Energy.
Renewable energy represented 16% of the total installed electricity generation capacity of 74.5 GW in 2021
6x

7. 7
Clean energy investment remains tilted towards RE
and overall falls short of investment needs
Source: Source: OECD calculations based on MEMR annual performance reports from 2011-19.
0
1 000
2 000
3 000
4 000
5 000
6 000
7 000
2011 2012 2013 2014 2015 2016 2017 2018 2019
USD Million, 2015
constant prices
Energy conservation
New and renewable energy
Bioenergy
Geothermal
Total (undifferentiated)
Annual renewable power
investment needs to 2025
(excl. large hydro)

8. Overview of CEFIM Activities in Indonesia
• First OECD Stakeholder Dialogue on Mobilising Clean Energy Finance and Investment (Nov, 2019)
• Focus Group Discussion: Use of Insurance Products to De-risk Clean Energy Projects (Jun, 2020)
• Focus Group Discussion: Financing Models for Efficient and Low-Carbon Cooling Systems (July, 2020)
• Launch of Clean Energy Finance and Investment (CEFI) Policy Review (Jun, 2021)
• Data Mapping – Indonesia’s financial system towards the clean energy transition (Aug 2021-Jun 2022)
• COP 26 talk show: Mobilising finance and investment for the clean energy transition (Nov, 2021)
• Facilitation on EE finance with UoB introduction to government of Indonesia (Nov, 2021)
• Provide inputs for the development of OJK’s Green Taxonomy Document (Dec, 2021)
• Series of FGD (4 FGDs) on the Emission Trading Scheme (ETS), joint events with IEA (Nov, ‘21- May, ‘22)
• Presentation to the G20 Energy Transition Working Group on ‘Financing Energy Transition’ (March, 2022)
• G20 Joint Webinar on Energy and Climate Financing (July, 2022)
• Clean Energy Finance Training (2022 – 2024, 1st training completed 31 Oct – 4 Nov 2022)
8

9. Clean Energy Finance and Investment (CEFI)
Policy Review of Indonesia (2021)
Key recommendations
• Streamline policies and regulations as part of
current reforms
• Shift to public, competitive tenders to
procure renewables
• International assistance can support
Indonesia accelerate its clean energy
transition
• Development funds could support blended
finance mechanisms
CEFI Policy Review
of Indonesia
9

10. 10
Public finance plays an important role in funding
power generation
0 1 2 3 4 5 6 7 8 9
Fossil fuel power
Geothermal
power
Hydropower
Utility-scale solar
PV and wind
USD billion
DFIs and
ECAs
Public
Private
Source: IEA(2020), Power investment trends in indonesia.

11. Financial Market Policy
Assessment highlights
• Indonesia has made remarkable progress in
mainstreaming sustainable finance
• Established sovereign green bond market,
but few corporate and sub-sovereign
issuances to date
• Financial institutions lack experience and
knowledge with financing clean energy
projects, barriers remain high
11

12. Financial Market Policy
Key recommendations
• Align definitions for sustainable finance across
sectors and economic plans
• Support corporate and sub-regional green
bond issuances
• Review bank regulations and practices (e.g.,
high collateral and legal lending limits)
• Consider development of guarantee schemes,
innovative financing structures and facilities to
de-risk clean energy projects
12

13. An overview of sustainable
finance implementation and
data mapping for clean energy
sector in Indonesia (pilot
survey)
The target a total population of
5326 financial institutions. The
survey was administered to a
target sample of 389
respondents from commercial
banks, non-bank financial
institutions (NBFI) as well as
capital market firms (OJK’s
classification for Indonesia’s
financial sector).
13
Assessing progress of Indonesia’s financial system towards
the clean energy transition
Key take aways
Objective
• Overall, the survey results indicate that
respondents are taking actions to foster
sustainable finance, although these remain tilted
towards capacity building and awareness-raising
activities. Still, numerous surveyed financial
institutions indicated continuing lacking human
resources capacity to assess clean energy
projects and thus comfort funding them,
including how to mitigate the risk.
• The use of alternative financing schemes for
sustainable projects remains overall limited
(financing scheme was relatively available for
other renewable technologies such as hydro
(particularly, mini and micro) and bioenergy).
• The relatively high share of loan allocated to on-
shore wind projects by the infrastructure
financing company over that period, however,
may suggest that that efforts to catalyse
investment for wind is under way.

14. • For project developers and
policy makers
• Increase financial
awareness to improve
project bankability and
policies
Energy Efficiency
Finance Course
• For financial institutions
• Enhance capacity to
undertake project due
diligence
• Develop new innovative
financing mechanisms
Clean Energy
Finance and
Investment Course • For project developers and
policy makers
• Increase financial
awareness to improve
project bankability and
policies
Renewable Energy
Finance Course
Clean Energy Finance and Investment Training
Objective: Breakdown silos across
finance and energy to develop financing
solutions that can scale private finance
for clean energy
14

15. • ESDM’s HR Development Agency and RE and EE Training Centre together with OJK
Institute co-organise the Clean Energy Finance and Investment training programme
• Training will be delivered in partnership with GIZ Clean Energy, Affordable, and Secure
Energy for Southeast Asia (CASE) and will build on past training activities
• Renewable energy and energy efficiency project developers, policy makers and financial
institutions will participate in the training
• 3-year annual training week with a training of trainers' session held in Year 3
Partners, stakeholders and timeline
H1 2022 31 Oct – 4 Nov 2022 June 2023 H1 2024
Course development
Training of trainers session
3rd Training Week
2nd Training Week
1st Training Week
15

16. • CEFIM and OJK are organising a series of Focus Group Discussions (FGDs) on
gender-responsive sustainable finance products and services in Indonesia.
• In order to implement OJK regulations on sustainable finance and consumer
protection, capacity building is required to enable financial institutions to acquire the
necessary knowledge on how to integrate gender considerations in sustainable
finance products and services.
• The series of FGDs will focus on:
I. An introduction to gender-responsive sustainable finance and investment strategies
(25 April 2023 - tbc)
II. Integrating gender in sustainable finance products, across different stages of the product life
cycle (June 2023)
III. Measuring, reporting and disclosing gender and sustainability performance
(November 2023)
16
Gender-responsive sustainable finance

17. • CEFIM and OJK are organising a series of Focus Group Discussions (FGDs) on
Transition Finance in Indonesia.
• In order to support Indonesia’s energy transition towards net-zero emissions and in
particular scale up finance for the decarbonization of Indonesia’s coal mining sector,
financial institutions are in need of relevant guidance.
• To this end, and to manage transition risk, OJK would like to put in place a transition
finance framework.
• The series of FGDs will provide perspectives on transition finance and its relevance to
coal transitions:
I. An introduction to the OECD Guidance on Transition Finance (21 March 2023)
II. Experiences from other countries on the transition of coal-based economies (May 2023)
III. Transition planning at the corporate level: how can corporates in coal-based industries
implement a credible transition? (July 2023)
IV. Transition finance instruments in coal-based economies and criteria for credibility (October
2023)
17
Transition Finance in Indonesia

18. 18
Please visit our webpage:
www.oecd.org/cefim/
Geraldine Ang
Geraldine.ANG@oecd.org
Cecilia Tam
Cecilia.TAM@oecd.org
Deger Saygin
Deger.SAYGIN@oecd.org
Hakimul Batih
Hakimul.BATIH@oecd.org
Istiana Maftuchah
Istiana.MAFTUCHAH@oecd.org